Bill Would Limit Class-action Suits

September 24, 1999|By STEPHEN LABATON The New York Times

WASHINGTON — The House of Representatives approved legislation on Thursday that would make it difficult, if not impossible, to bring successful large class-action lawsuits against tobacco companies, gun makers and a wide variety of other businesses.

The legislation was supported by many major industries, from automobile and chemical producers to small aircraft makers and insurance companies.

It would require state court judges, who have often been more sympathetic to plaintiffs in such suits, to transfer most of their class-action lawsuits to federal courts. The federal rules on class actions are often more stringent than many state court procedures and, as a result, plaintiffs' lawyers have been making greater and more successful use of state courts in recent years.

Sponsored by Rep. Bob Goodlatte, R-Va., the measure was approved 222-207 on a vote largely along party lines. It followed heavy lobbying and ferocious campaign fund-raising on both sides -- big business vs. trial lawyers -- and is similar to a bill that enjoys bipartisan support in the Senate. The Senate bill is sponsored by Sens. Charles Grassley, R-Iowa, and Herb Kohl, D-Wis.

White House officials said Thursday that they had recommended that the president veto the legislation if it reaches his desk because it would lead to the widespread dismissal of many kinds of claims that plaintiffs are now winning, and which have had the effect of protecting consumers and deterring corporate misconduct.

Supporters of the House legislation said that the measure is aimed at ending abusive maneuvers by trial lawyers. They condemned what they say is a growing number of instances where state judges are making decisions that have nationwide implications in tobacco and other lawsuits against businesses. Supporters also say that state court judges are often biased against out-of-state defendants.

The cases affected would include everything from employment discrimination, environmental disasters and health care fraud, to product liability cases such as asbestos suits.

"This bill will correct a statutory anomaly, as well as the gaming of the system by plaintiff attorneys," said Rep. James Moran, D-Va., and one of the sponsors of the legislation. "Now a judge in one state decides the laws in all the states. But I don't want the laws of Virginia to be decided by some judge in Texas."

But opponents of the legislation said that it was outrageous for a Congress that has left so many federal judgeships vacant -- by failing to confirm White House's nominees -- to now be broadly expanding the caseload of an already overworked federal judiciary. There are 64 vacancies in the federal district and appeals courts, and judges have complained that their workload has increased dramatically, in part because of legislation that has created new federal crimes and in part because Congress has not created any new judge positions for nearly a decade.

As a result, critics said, those class-action lawsuits that would not be dismissed by the federal courts as a result of the legislation would be significantly delayed.

"This represents a sealed, locked, closed and forever impenetrable door to justice," said Rep. Sheila Jackson Lee, D-Texas. Other opponents of the legislation called it a form of "backdoor immunity" for tobacco companies and gun makers.

The legislation's critics include a policy group of federal judges headed by Chief Justice William Rehnquist, the Conference of Chief Justices of state courts, 15 state attorneys general, a number of lawyer organizations, and a broad array of civil rights, disabilities, consumer, anti-tobacco, gun control and health care groups.

The organizations pushing for the legislation include some of the nation's most significant business interests, including the U.S. Chamber of Commerce, the Chemical Manufacturers Association, DaimlerChrysler and General Motors, the International Mass Retail Association, Pfizer, Philip Morris, Procter & Gamble. The lobbyists working for the legislation have included Jack Quinn, a former White House counsel in the Clinton administration, and Arthur Culvahouse Jr., a former White House counsel to President Ronald Reagan.

The most notable opponents of the legislation included the Association of Trial Lawyers of America and Public Citizen, a consumer group founded by Ralph Nader that led a coalition of other public interest organizations. Nader met at the White House last month with John Podesta, the president's chief of staff, along with representatives from the trial lawyers and other groups. The groups working to defeat the bill include the American Heart and Lung Associations, the Campaign for Tobacco-Free kids, the Violence Policy Center (a gun control group), and a number of labor organizations.